Stuck in the middle

The international strategic community is by now habitual of suspecting a strategic rivalry between India and China all over the globe. Maldives, a tiny island nation in the Indian Ocean, is the newest addition to the great strategic game being played by the two leading Asian powers.
A recent law passed by Maldivian parliament has further fueled theories of a perceived strategic rivalry between India and China in Maldives. This legislation, called the Foreign Ownership Land bill, was passed by the Majlis on July 22, 2015 by amending the Constitution. It approved foreign ownership of land on a freehold basis, a move seen as benefitting China.
Of the 84 members present in the Majlis, 70 voted in favor, with 14 against and no abstentions. Ten MPs of the main opposition Maldivian Democratic Party (MDP) and nine MPs of the Jumhooree Party also voted in favor of the unprecedented changes.
Prior to this amendment Maldives’ constitution prohibited foreigners from owning land under any circumstances, but allowed the government to lease land to foreign parties for up to 99 years. The current amendment is the second amendment to the constitution since the statute was ratified in 2008.
The bill, proposed by MP of the ruling party Ahmed Nihan Hussain Manik, states that any investor who invests a minimum of $1 billion could obtain a freehold of the land, if the 70 percent of the project area is reclaimed from the ocean and the reclaimed land is visible at medium tide. The land allocated to freehold under the amendments is 10 percent of the total land area of Maldives. The bill also conditions that the projects thus awarded are to be approved by the parliament before they are awarded.
Article 251 of the Maldivian constitution, in its previous form, had stipulated that no part of country’s territory shall be used for foreign military purposes without the approval of the majority of the total membership of the Majlis. This article now stands amended and a new chapter to the constitution has been added. It now reads to state that “No foreign party shall own land in the Maldives, except under the circumstances specified in Article 302. Allowing foreigners to own land under Article 302 does not undermine the Maldivian state’s sovereignty over its territory and does not amount to loss of territory.”
The bill was petitioned and passed overnight, which opposition MPs heavily criticized stating that more time is needed to evaluate amendments to the Constitution. The controversial amendment to the constitution has been criticized by top politicians including the president of ruling Progressive Party of Maldives (PPM), former President Maumoon Abdul Gayoom, who called on President Yameen to go for a public referendum before ratifying the bill.
Shortly before the vote was called, Gayoom, leader of the PPM and half-brother of President Abdulla Yameen, urged the president to seek public opinion before ratifying the amendments. Significantly, this is the first time Gayoom has publicly opposed Yameen’s actions.
The Maldives government has stated that the new law is meant to “attract mega development projects and generate jobs” in the country. This could be true given the experience of countries in the Middle East like UAE where large-scale land reclamation from the sea has generated jobs and created tourism avenues where little infrastructure once existed.
PPM MP Ali Arif conceded that the Maldives as a small nation was always vulnerable to influence from powerful nations adding that the committee addressed the concerns over sovereignty during its review process and added a clause to the bill stating that the Maldivian state will exercise complete authority over the territory designated for projects. He added that 80 or 90 percent of the Maldives’ 112 luxury resorts are operated by foreign businesses and multinational hotel chains have invested millions of dollars in the lucrative tourism industry.
Incidentally, the Maldivian government has assured India that the Indian Ocean will remain “a demilitarized zone.” The Maldivian assurance was given to Indian Foreign Secretary S. Jaishankar who visited Male recently. Authorities in Male have denied any non-commercial reason for the Constitutional amendment to allow foreign ownership of land. Interestingly, the Chinese Embassy in Male too has denied having any strategic interest in the Maldives.
The Chinese Foreign Ministry said the Majlis vote was an internal matter for the Maldives, adding that China wanted good relations with the country. China “has always respected and supported the Maldives’ efforts to maintain its sovereignty, independence and territorial integrity,” the ministry said. “What the relevant people said about China building bases in the Maldives is totally baseless,” it added.
In September 2014, during a visit by Chinese President Xi Jinping, Maldives signed a deal with a Chinese company to upgrade its international airport after cancelling a $511 million deal with India’s GMR Infrastructure in 2012. China is also providing grant and loan assistance to Maldives to build a bridge between the capital and the airport. Chinese companies are involved in airport development and have now been handed islands for resort development.
President Abdulla Yameen has assured Prime Minister Narendra Modi that the Indian Ocean would remain a demilitarized zone. He made this commitment in a letter addressed to Modi delivered by Maldivian Foreign Secretary Ali Naseer Mohamed to External Affairs Minister Sushma Swaraj. Maldives would do a world of good to ensure by its deeds and not words that the island nation is not falling to the great game of expansion of strategic influence of large nations.